Mollydooker Wines owner and chief executive Sarah Marquis spent last month’s South Australian vintage in isolation as she recovered from COVID-19 and watched the company’s US distribution grind to a halt.
But, despite the setbacks, Marquis is upbeat about the future and has been using the downtime to reposition the business to grow online sales and revitalise its cellar door offering.
Marquis was hosting a skiing trip in Colorado for Mollydooker’s top US distributors when the coronavirus pandemic forced the mountain to close its resorts in mid-March. She arrived back in South Australia on March 17 and immediately went into self-isolation before testing positive to COVID-19 a week later. She spent the next five days enduring mild headaches and nausea.
“We were just starting vintage and I had to self-isolate for two weeks with my partner and then I had to self-isolate for another 14 days to make sure I no longer had any symptoms,” Marquis said.
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“As soon as I said I had COVID-19, the (winery) team got even more serious about wiping down surfaces and they are still doing it at the end of every day, and half of our staff are still working from home.
“The head winemaker and the head viticulturist have been doing it for 15 years and knew exactly what to do so we could keep running and it was fine with me not being there. I just worked from isolation and made a lot of phone calls.
“My expertise as a winemaker comes in with the blending and … the style making, which happens a bit later.”
Online sales save the day
The Mollydooker cellar door in the McLaren Vale wine region of South Australia has been closed since March 18. However, the shutdown has coincided with a 30%-off online sale in Australia and the US, which Marquis said had more than offset the loss of cellar-door sales.
She said the four-fold increase in online sales had been vital for maintaining some cash flow and had opened up new revenue opportunities in Australia and overseas.
Mollydooker Wines, which takes its name from an old Australian slang word for a left-handed person, was started by Marquis, who is left-handed, and her former husband, Sparky, in 2005. It sold about 30,000 cases of McLaren Vale wine exclusively in the US in its first year.
The company produced 90,000 cases in 2019 and now sells about 50% in the US, 25% in Australia and 25% in other countries including South Korea, Denmark, Germany and Canada.
About 98% of Mollydooker’s wine is red, with Shiraz and Shiraz blends making up about 80% of production. It is also known for its colourful names, velvet labels and its quirky “Mollydooker Shake” wine serving method.
Dry conditions and a cool spring led to a much smaller-than-average vintage across South Australia this year, with Mollydooker on track to produce just 55,000 cases from the 2020 crop. About a third of the winery’s grapes are estate grown while the remainder are sourced from McLaren Vale, about 40 kilometres south of Adelaide, and nearby Langhorne Creek.
Although yields were down in McLaren Vale this year, the quality of the vintage is high as the region escaped any ill-effects from bushfires that ravaged several of Australia’s other wine-growing areas.
Marquis said the current dip in sales meant the small vintage came at the ideal time. However, she acknowledged that many wineries may not have been as well placed to cope with a downturn, particularly those that relied heavily on cellar door sales and custom from hotels and restaurants.
Tensions with China leave sour taste
Rising tension between Australia and China, its biggest wine customer, is also putting pressure on wine companies heavily reliant on Chinese orders.
“Just the way our business is set up, we’re not reliant on China,” Marquis said.
“Online sales have gone very well and with a small vintage coming up, if there’s a little lag it’s kind of good because we’ve got less coming out in a year and a half.
“In the 2016 and ’17 vintages we had 96,000 and 90,000 cases, which was up from 75,000 and we haven’t quite got through all of that yet but now with the smaller vintage coming it’s perfect.”
Marquis studied winemaking at the University of Adelaide’s viticulture and oenology faculty alongside the likes of Peter Gago and Stephen Pannell in the late 1980s. After university she worked at Fox Creek in McLaren Vale, which was started by her parents, Helen and Jim Watts, in 1984.
Marquis and Sparky began making wine for the US market under the Marquis Philips label in the early 2000s in partnership with US wine importer Dan Philips. But the relationship soured after a few years, leading to the launch of Mollydooker.
Marquis and Sparky went their separate ways in 2015, with Marquis taking sole ownership of the award-winning Mollydooker Wines in 2017.
The company was last year named the 2019 Telstra South Australian Business of the Year.
Foothold in the US has helped
Mollydooker has its own importing company in the US and two permanent staff members there, as well as Marquis’ son Luke, who heads up the winery’s US distribution. About 70% of its US distribution is through retail outlets including Costco and Trader Joe’s, while the remainder is to restaurants and other on-premises customers. Its wines are sold in 48 states with California and Texas the biggest buyers.
However, Marquis said the recent surge of online sales in the US had been a “saving grace” and pointed to further opportunities to grow direct-to-consumer sales in the future.
She said the import business was the key to Mollydooker’s long run of success in the US as it allowed the company to increase its margins and maintain control of its wine for longer.
“A lot of Australian wineries were in the US and then, when the GFC hit and the exchange rate was bad, many pulled out because they weren’t making any money. But we stayed in there because we owned the import business, which allowed us to make a little bit more margin than most other wineries and that means our product also ends up at a really good price point.
“When the exchange rate was at $1.10 in 2011 and 2012 that did hurt us but we stayed in the market along with only a few others such as Penfolds, Yellow Tail, Henschke and Two Hands and right now with the exchange rate we’re making almost double.”
The US is the second-largest importer of Australian wine but sales have slowed in the past two months as the nation attempts to recover from the COVID-19 pandemic.
“When COVID hit, the US just stopped ordering and our sales slumped 60 percent there last month but the increase in online sales has helped,” Marquis said
“So far this May, we have seen a busier selling month from distributors into restaurants and retailers that have remained open compared to last year, so we are hoping this continues.”
However, Marquis said she was relieved Mollydooker had reduced its reliance on the US in recent years.
“I’m glad I’ve spread the risk now as our sales to the rest of the world has picked up … they all bought like crazy last month, which was a surprise.
“South Korea is a great market and we sell about 5000 cases a year to Denmark and also into Canada.”
Reinventing the cellar door
Back home, Mollydooker has 50 staff and Marquis is thinking about how to reinvent the cellar door experience with a possible re-opening next month.
“I like the time to reflect at the moment and reinvent the business and a lot of people should be doing it because things will change and we just need to be flexible.
“I’m really looking at the business including the profit and loss and the operating costs of the cellar door and I want to re-open with a new offering that’s not just a free-for-all tasting.
“We want to do proper cellar door packages from a full velvet experience including a winery tour and private tasting through to a fun $10 tasting where you taste nine wines and get to keep your glass.”
“Maybe next month if we do open we might do it by appointment only on the weekends so we will limit our numbers and keep it safe and then when everything goes back to normal we’ll offer a couple of different experiences.”
This article was first published by The Lead.